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Price v. Strategic Capital Partners, LLC

404 N.J. Super. 295, 961 A.2d 743 (App. Div. 2008)

ZONING — Where a variance application does not necessarily address a particular case, but deals with a common problem in the zone, such as it not being economical to build in compliance with the zone’s restrictions, a board may not issue the variance because to do so would be to engage in “rezoning by variance.”

An owner of a tract of land located in a multi-family residential zoning district and a Steep Slope Overlay Zoning District (SSOD zone) sought a density variance from a municipality. The owner intended to construct an 18-story high rise luxury residential building containing ninety units. Because the property was located in the SSOD zone, the proposed building would ordinarily be limited to thirty residential units. After listening to expert and community testimony that generally approved of the project, the planning board unanimously approved the application. An interested citizen filed suit challenging the grant of the density variance. The board’s decision was upheld by the lower court in an oral opinion. The citizen appealed.

The Appellate Division reversed and remanded for further consideration by the board. It held that a zoning board of adjustment only may grant density variances for special reasons in particular cases. In this matter, the Court agreed with the citizen’s argument that the application before the board did not necessarily address a particular case but dealt with a common problem in the SSOD zone, i.e., that it was not economical to build a low-density high rise there. The citizen alleged that this was a problem faced by all property owners and developers in that zone. As such, he contended that the board was not authorized to engage in “rezoning by variance.” The Court looked favorably at this argument, saying that constructing this building would increase the permitted density by more than three hundred percent. It held that the owner would have to demonstrate a compelling reason before such a variance could to be granted. Therefore, it remanded for the board to make findings whether this matter could be resolved through the grant of a variance, or a more general problem that had to be addressed by an ordinance change.

If the latter, the Court stated that a successful application for a density variance had to show that: (a) despite the proposed increase in density above the zone’s restrictions, the project served one or more of the purposes of zoning; and (b) such a density increase would not have a more detrimental effect on the neighborhood than would be the case if construction of the project was performed in a manner consistent with the zone’s regulations. The Court ruled that the board had to clearly articulate why such any significant departure from the established density requirement would not impair the purposes of the SSOD zone.

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